[Federal Register Volume 63, Number 132 (Friday, July 10, 1998)]
[Notices]
[Pages 37329-37331]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-18443]


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DEPARTMENT OF COMMERCE

International Trade Administration
[A-580-805]


Industrial Nitrocellulose From the Republic of Korea; Preliminary 
Results of Antidumping Duty Administrative Review

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.

ACTION: Notice of preliminary results of antidumping duty 
administrative review.

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SUMMARY: In response to a request by the respondent, Daesang 
Corporation (Daesang) <SUP>1</SUP> the Department of Commerce (the 
Department) is conducting an administrative review of the antidumping 
duty order on industrial nitrocellulose from the Republic of Korea 
(Korea). The review covers one manufacturer/exporter of the subject 
merchandise to the United States during the period July 1, 1996 through 
June 30, 1997. The review indicates the existence of dumping margins 
during the review period.
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    \1\ In its questionnaire response dated October 31, 1997, 
Daesang was referred to as Miwon Co., Ltd. Daesang advised the 
Department by letter dated December 5, 1997 that its name had been 
changed.
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    We have preliminarily determined that sales have been made below 
normal value (NV). If these preliminary results are adopted in our 
final results of administrative review, we will instruct the U.S. 
Customs Service to assess antidumping duties based on the difference 
between United States price (U.S. price) and NV.
    Interested parties are invited to comment on these preliminary 
results. Parties who submit argument are requested to submit with each 
argument (1) a statement of the issue and (2) a brief summary of the 
argument.

EFFECTIVE DATE: July 10, 1998.

FOR FURTHER INFORMATION CONTACT: Elfi Blum or Maureen Flannery, Import 
Administration, International Trade Administration, U.S. Department of 
Commerce, 14th Street and Constitution Avenue, N.W., Washington, D.C. 
20230; telephone: (202) 482-0197 or 482-3020, respectively.

Applicable Statute and Regulations

    Unless otherwise indicated, all citations to the statute are 
references to the provisions effective January 1, 1995, the effective 
date of the amendments made to the Tariff Act of 1930 (the Act) by the 
Uruguay Round Agreements Act (URAA). In addition, unless otherwise 
indicated, all citations to the Department's regulations are to 19 CFR 
Part 351 (62FR 27296, May 19, 1997).

SUPPLEMENTARY INFORMATION:

Background

    On July 10, 1990, the Department published in the Federal Register 
(55 FR 28267) the antidumping order on industrial nitrocellulose (INC) 
from Korea. On July 2, 1997, the Department published in the Federal 
Register (62 FR 38973) a notice of opportunity to request an 
administrative review of this antidumping duty order. On July 31, 1997, 
in accordance with 19 CFR 351.213, one exporter of the subject 
merchandise to the United States, Daesang, requested that the 
Department conduct an administrative review of its exports of subject 
merchandise to the United States. We published a notice of initiation 
of this administrative review on September 25, 1997 (62 FR 50292), 
covering the period July 1, 1996 through June 30, 1997.

Scope of Review

    Imports covered by this review are shipments of INC from Korea. INC 
is a dry, white amorphous synthetic chemical with a nitrogen content 
between 10.8 and 12.2 percent, and is produced from the reaction of 
cellulose with nitric acid. INC is used as a film-former in coatings, 
lacquers, furniture finishes, and printing inks. The scope of this 
order does not include explosive grade nitrocellulose, which has a 
nitrogen content of greater than 12.2 percent.
    INC is currently classified under Harmonized Tariff System (HTS) 
subheading 3912.20.00. While the HTS item number is provided for 
convenience and Customs purposes, the written description remains 
dispositive as to the scope of the product coverage. The review period 
is July 1, 1996 through June 30, 1997.

Verification

    As provided in section 782(i) of the Act, we conducted a U.S. 
verification of the questionnaire responses submitted by Daesang 
Corporation, concerning its U.S. affiliate, Daesang America. We used 
standard verification procedures, including the examination of relevant 
accounting, sales, and other financial records, and the selection of 
original documentation containing relevant information. Our 
verification results are outlined in the public version of the 
verification report.

United States Price

    In calculating the United States Price (USP), we used export price 
(EP), in accordance with section 772 (a) and (c) of the Act, because 
Daesang's sales to the first unaffiliated purchaser occurred before 
importation into the United States, and because constructed export 
price (CEP) methodology was not otherwise indicated. We based EP on the 
packed prices to the first unaffiliated purchaser in the United States. 
We made deductions from the starting price, where appropriate, for 
foreign inland freight, foreign brokerage and handling, ocean freight, 
marine insurance, U.S. customs brokerage and U.S. duties. We also added 
an amount for duty drawback. No other adjustments were claimed or 
allowed.

Normal Value

    In calculating NV, we used home market prices to unaffiliated 
purchasers, as defined in section 773 of the Act. In order to determine 
whether there was a sufficient volume of sales in the home market to 
serve as a viable basis for calculating NV, we compared Daesang's 
volume of home market sales of the subject merchandise to the volume of 
U.S. sales of the subject merchandise, in accordance with section 
773(a)(1)(C) of the Act. Because Daesang's volume of home market sales 
of the subject merchandise was greater than five percent of its volume 
of U.S. sales of the subject merchandise, we determined that the home 
market provides a viable basis for calculating NV for Daesang.

[[Page 37330]]

    We based NV on the gross unit price, and made deductions, where 
appropriate, for inland freight from the plant to the warehouse, inland 
freight from the plant or warehouse to the customer, presale 
warehousing expenses, handling charges, and commissions. We made a 
circumstance-of-sale adjustment, where appropriate, by deducting home 
market direct selling expenses and adding U.S. direct selling expenses. 
We also made adjustments, where applicable, for U.S. indirect selling 
expenses to offset home market commissions.

Level of Trade

    In accordance with section 773(a)(1)(B) of the Act, to the extent 
practicable, we determine NV based on sales in the comparison market at 
the same level of trade (LOT) as the EP transaction. The NV LOT is that 
of the starting-price sales in the comparison market or, when NV is 
based on constructed value, that of the sales from which we derive 
selling, general and administrative expenses and profit. For EP, the 
U.S. LOT is also the level of the starting-price sale, which is usually 
from exporter to importer. For CEP, it is the level of the constructed 
sale from the exporter to the importer.
    To determine whether NV sales are at a different LOT than EP or 
CEP, we examine stages in the marketing process and selling functions 
along the chain of distribution between the producer and the 
unaffiliated customer. If the comparison-market sales are at a 
different LOT, and the difference affects price comparability, as 
manifested in a pattern of consistent price differences between the 
sales on which NV is based and comparison-market sales at the LOT of 
the export transaction, we make a LOT adjustment under section 
773(a)(7)(A) of the Act. Finally, for CEP sales, if the NV level is 
more remote from the factory than the CEP level and there is no basis 
for determining whether the difference in the levels NV and CEP affects 
price comparability, we adjust NV under section 773(a)(7)(B) of the Act 
(the CEP offset provision). See Notice of Final Determination of Sales 
at Less Than Fair Value: Certain Cut-to-Length Carbon Steel Plate From 
South Africa, 62 FR 61731, 61732 (November 19, 1997).
    Daesang did not claim a LOT adjustment; however, we requested 
information concerning Daesang's distribution system, including classes 
of customers, selling functions, and selling expenses, to determine 
whether such an adjustment was necessary. Daesang reported that all 
sales to the United States during the Period of Review (POR) were to 
distributors, and sales in the comparison market, the home market in 
this case, were to end-users or distributors. Daesang claimed that 
there were no differences in selling functions or selling expenses 
between sales in the home market and sales in the United States, nor 
did we find any such difference. Therefore, we preliminarily determine 
that sales in the home market and sales in the United States are at the 
same LOT, and that no adjustment is warranted.

Preliminary Results of the Review

    As a result of our review, we preliminarily determine that the 
following margin exists for the period July 1, 1996 through June 30, 
1997:

------------------------------------------------------------------------
                                                                Margin  
                    Manufacturer/Exporter                      (percent)
------------------------------------------------------------------------
Daesang Corporation.........................................        8.72
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    Parties to the proceeding may request disclosure within 5 days of 
the date of publication of this notice in accordance with 19 CFR 
351.224. Any interested party may request a hearing within 30 days of 
publication in accordance with 19 CFR 351.310. Any hearing, if 
requested, will be held 44 days after the publication of this notice, 
or the first workday thereafter. Interested parties may submit case 
briefs within 30 days of the date of publication of this notice in 
accordance with 19 CFR 351.309. Rebuttal briefs, which must be limited 
to issues raised in the case briefs, may be filed within five days 
after the time limit for filing case briefs. See 19 CFR 351.309. 
Parties who submit argument in this proceeding are requested to submit 
with the argument (1) a statement of the issue and (2) a brief summary 
of the argument. The Department will publish a notice of final results 
of this administrative review, which will include the results of its 
analysis of issues raised in any such comments, not later than 120 days 
after the date of publication of this notice.
    Upon issuance of the final results of review, the Department shall 
determine, and the Customs Service shall assess, antidumping duties on 
all appropriate entries. We have calculated importer-specific ad 
valorem duty assessment rates based on the ratio of the total amount of 
dumping margins calculated for the examined sales made during the POR 
to the total customs value of the sales used to calculate those duties. 
These rates will be assessed uniformly on all entries of each 
particular importer made during the POR. (This is equivalent to 
dividing the total amount of antidumping duties, which are calculated 
by taking the difference between statutory NV and statutory EP, by the 
total statutory EP value of the sales compared, and adjusting the 
result by the average difference between EP and customs value for all 
merchandise during the POR.)
    The final results of this review shall be the basis for the 
assessment of antidumping duties on entries of merchandise covered by 
the determination and for future deposits of estimated duties. Upon 
completion of this review, the Department will issue appraisement 
instructions directly to the U.S. Customs Service.
    Furthermore, the following deposit requirements will be effective 
upon publication of the final results of this administrative review for 
all shipments of INC from Korea entered, or withdrawn from warehouse, 
for consumption on or after the publication date, as provided for by 
section 751(a)(2)(C) of the Act: (1) The cash deposit rate for Daesang 
will be the rate established in the final results of this review; (2) 
for previously reviewed or investigated companies not listed above, the 
cash deposit rate will continue to be the company-specific rate 
published for the most recent period; (3) if the exporter is not a firm 
covered in this review, a prior review, or the original less-than-fair-
value investigation, but the manufacturer is, the cash deposit rate 
will be the rate established for the most recent period for the 
manufacturer of the merchandise; and (4) for all other producers and/or 
exporters of this merchandise, the cash deposit rate shall be the rate 
established in the investigation of sales at less than fair value, 
which is 66.3 percent. See 55 FR 28267 (May 22, 1990).
    These deposit rates, when imposed, shall remain in effect until 
publication of the final results of the next administrative review.

Notification of Interested Parties

    This notice serves as a preliminary reminder to importers of their 
responsibility under section 19 CFR 351.402(f) of the Department's 
regulations to file a certificate regarding the reimbursement of 
antidumping duties prior to liquidation of the relevant entries during 
this review period. Failure to comply with this requirement could 
result in the Secretary's presumption that reimbursement of antidumping 
duties occurred and the subsequent assessment of double antidumping 
duties.
    This administrative review and notice are in accordance with 
section 751(a)(1) of the Act (19 U.S.C. 1675(a)(1)) and 19 CFR 351.213, 
351.221.


[[Page 37331]]


    Dated: June 30, 1998.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.
[FR Doc. 98-18443 Filed 7-9-98; 8:45 am]
BILLING CODE 3510-DS-P